Retail TouchPoints: Retailers Invest In Social Networks Despite Limited ROI
Through a special arrangement, presented here for discussion
is a summary of a current article from the Retail TouchPoints website.
are banking more on the qualitative advantages of a social media presence,
versus a quantitative ROI, according to The State Of Retailing Online 2011:
Marketing, Social, and Mobile report conducted by Forrester Research for Shop.org. "On
average, retailers report that only a small single-digit percent of sales can
be attributed to social media at this juncture," the report stated. "Close
to two-thirds (62 percent and 61 percent, respectively) of retailers surveyed
also note that the ROI associated with social is unclear and that the primary
ROI is around listening."
Results from Facebook investments, for example,
rank below investments in paid search, email and affiliate marketing. The most
popular social network also does not retain customers or attract new customers,
survey respondents noted. Only six percent said Facebook improves the lifetime
value of existing customers and one percent use it for customer acquisition.
Brand building (40 percent) and listening to customers (37 percent) currently
are the top two benefits of Facebook spending, according to the report.
retailers are increasing their social network investments. Approximately 72
percent of retailers surveyed said they will increase spending on social networks
in 2011, although SEO/natural search (75 percent) remains the top area receiving
an increase in marketing spend.
Sixteen percent of retailers reported an increase
in wireless/mobile marketing for 2011, although the number may be under-represented
because 61 percent of retailers are increasing their investment in paid search,
which also includes mobile. The tablet industry is helping to push mobile investments
up, with retailers reporting that 21 percent of all mobile traffic is coming
from tablets, even though the iPad was launched just one year prior to the
Generally, retailers are only in the initial stages of a refined mobile
strategy. Only 29 percent of retailers who have a strategy currently are working
to refine it, and another 28 percent are just implementing a mobile strategy
and/or starting to work on it.
The top goals for mobile are improving customer
satisfaction (64 percent) and developing brand loyalty (64 percent). Just over
57 percent are hoping to improve customer acquisition with mobile and 55 percent
are planning to improve customer retention.
"The data indicates that significant investments in social and mobile
tactics will be in place this year," added Sucharita Mulpuru, vice president,
principal analyst, Forrester Research. "Retail executives should have
modest expectations for the benefits of social commerce. With regard to mobile,
retailers should be working to increasingly integrate features and functionality
into the physical store experience. While consumers may not be extensively
exploring product information yet, basic store information, transparent pricing,
and easy checkout capabilities are likely to be the most pressing opportunities
for most sites in the near term."
- Retailers Invest In Social Networks
Despite Limited ROI – Retail TouchPoints
- Retailers Increasing Mobile And Social Efforts, According To Shop.org/Forrester
Survey – National Retail Federation
Discussion Questions: Where should retailers be focusing their investments in social media and mobile commerce in the near term? What should be the top goals for improving social as well as mobile customer experiences?